National Settlement Depository (NSD), Russia’s central securities depository, has summed up its 2014 third quarter operating results. This has been a period of the most significant developments for NSD this year. The company's business streams demonstrated positive dynamics in July-September 2014.
Central Securities Depository's Services
Value of securities on deposit reached RUB22.8 trillion at the end of Q3 2014; this is 11% more than in the similar period of 2013 (RUB20.5 trillion).
In Q3 2014, an important event took place – the Bank of Russia assigned the status of a systemically important CSD and a settlement depository to NSD.
The number of inventory operations in Q3 2014 exceeded 630 thousand. This is 11% less than in Q3 2013. In Q3 2014, the number of operations held as a result of exchange trading amounted to 495.9 thousand against 587.6 thousand operations in Q3 2013 (declined 15.6%), and the number of OTC operations grew 11%, compared to the same period of 2013 (from 122.4 thousand to 135.7 thousand operations). Settlements on OTC operations were held on the basis of FOP (68.8 thousand operations) and DVP (66.9 thousand operations). DVP operations grew by almost 45% compared to the same quarter of 2013.
Collateral Management System
NSD's service of collateral management for the Bank of Russia's repo transactions is becoming more popular among market participants. A number of market participants connected to the collateral management system reached 195 by the end of Q3 2014.
The value of collateral assets managed by NSD grew significantly in Q3 2014 against the same period of 2013 – from RUB80 billion to RUB1 trillion.
In Q3 2013, a number of registered reports exceeded 43 thousand. The number of reports on repo transactions and currency swaps subject to mandatory reporting exceeded 11,200*. Totally for 9M 2014, the number of registered reports reached more than 92 thousand, and the number of clients using repository services exceeded 1,000.
On 26 September 2014, NSD’s repository was recognized a systemically important repository in the Russian market.
Corporate Actions Center
In Q3 2014, NSD conducted 20% more operations related to corporate actions as compared to the same period of 2013 — 3.95 thousand in 2014 against 3.27 thousand in 2013. Out of them, 767 operations were conducted with foreign securities (this is three times as many as in 2013). In Q3 2014, NSD actively used ISO 15022 messages for corporate actions. NSD processed over 7.2 thousand SWIFT messages for foreign securities and formed more than 9 thousand SWIFT messages for Russian securities.
NSD has actively implemented a corporate actions reform in the Russian market to introduce modern technologies and international standards based on EDI. On 2 August 2014, the amended law allowing shareholders with securities kept with depositories to conduct e-proxy-voting was put into effect. After that, the e-proxy-voting technology was introduced by NSD in cooperation with securities market participants; the technology included formats developed by NSD.
In Q3 2014, value of money transfers declined 11% over the corresponding period of the previous year and reached RUB73.6 trillion (RUB82.6 trillion for Q3 2013). Meanwhile, the value of currency transfers increased more than two and a half times – from 0.3 trillion (2013) to 0.8 trillion (2014) in ruble equivalent.
On 14 July 2014, the Bank of Russia recognized NSD Payment System as nationally important.
National Numbering Agency
NSD acts as Russia’s Numbering Agency assigning ISINs and CFIs to Russian issuers’ securities and financial instruments issued or registered in the territory of Russia. In Q3 2014, NSD assigned 169 ISINs and CFIs and 33 LEIs. On 7 July 2014, NSD received the pre-LEI status.
On 1 July 2014, NSD’s backup office began functioning on the full time basis. In September, the company successfully conducted a number of tests to provide business continuity related to NSD’s business process critically sensitive to interruption.Eddie Astanin, Chairman of the Executive Board, NSD, said: “The positive dynamics in our key business streams in Q3 2014 let us say that NSD is evolving steadily and consistently as a systemically important institution.”
* — Including the Bank of Russia's repo transactions with the securities basket.